What does the FCA mean in insurance and why is important?

When you are buying car insurance, you will often see phrases like ‘FCA regulated’ or ‘authorised and regulated by the FCA’. 

It sounds reassuring, but it is still worth knowing what it actually means, what the FCA does (and does not do), and where you should go if something goes wrong.

In this guide, we will answer the most frequently asked questions about the FCA and insurance to ensure total transparency about how we are regulated.

Main points

• In insurance, the FCA regulates how firms behave, including how they sell, communicate, and handle complaints. 
• UK insurance regulation is often described as twin peaks: the PRA focuses on financial soundness, the FCA focuses on conduct. 
• The FCA rules require firms to tell you who they are, whether they give a personal recommendation (advised sale), and how to complain. 
• You can check a firm using the Financial Services Register or the FCA Firm Checker, depending on what you need to confirm. 
• The FCA is not an ombudsman. For individual disputes, you usually complain to the firm first, then go to the Financial Ombudsman Service (FOS) if needed. 

What does FCA mean in insurance?

‘FCA’ usually refers to the Financial Conduct Authority. When you see FCA mentioned on insurance documents or broker websites, it usually relates to regulation of conduct, meaning how a firm sells policies, communicates with customers, and handles issues. 

The FCA also requires firms to give you key status information, including whether the firm provides a personal recommendation and how you can complain.

Is insurance FCA regulated?

Insurance is regulated under the “twin peaks” approach:

• The Prudential Regulation Authority (PRA) focuses on the financial safety and soundness of insurers (i.e., their ability to meet claims). 
• The FCA focuses on conduct, meaning how insurance firms and intermediaries behave, treat customers, and communicate. 

So if you are dealing with a broker, an insurer, or another insurance distributor, the FCA is commonly part of the regulatory picture.

What does the FCA do in insurance?

The FCA sets rules and standards for insurance firms.  It is mostly about customer outcomes and fair conduct, not about choosing policies for you or deciding whether a specific claim should be paid. 

The FCA expects insurance professionals like us to follow their lead in strict guidance areas and offer transparency with:

• Pre-sale information and clarity
• Whether the firm is giving you a personal recommendation (advised) or not (non-advised)
• How you can complain, including signposting to the Financial Ombudsman Service where applicable.

Do all insurers and brokers provide an advisory service?

Some insurance journeys are advised, where you receive a personal recommendation. Others are not advised, where you are given information, but you choose the product yourself.

FCA rules require firms to tell customers whether they provide a personal recommendation about the products offered. 

If you are unsure, ask before you buy:
“Is this an advised sale, and are you giving me a personal recommendation?”

Why is it important to check a financial company is FCA-approved and registered?

Being proactive to check a company is FCA registered reduces risk. A firm can be real but still not have permission for a specific activity, so permissions matter. A lack of authorisation can affect whether you have access to protections in the event of an issue. 

The FCA recommends using:

• FCA Firm Checker if you are about to buy a product or service and want to confirm the firm is authorised and has permission for what it is offering 
• Financial Services Register if you want the full regulatory record, historical status, or information about individuals 

If you’re unsure of what to check, keep the following in mind:

• Does the firm name match exactly, including trading name
• Do the contact details match the ones on the register
• Does the firm have the right permissions for what it is doing

Can I report an insurance company to the FCA?

You can raise concerns with the FCA, but it is important to set expectations regarding the results you want to achieve and what can be done.

If your goal is personal redress, such as getting a complaint resolved or compensation, the usual route is:

1. Complain directly to the firm first
2. If you are unhappy with the outcome, or you do not hear back within the right timeframe, go to the Financial Ombudsman Service

The FCA can use consumer information to inform supervision and enforcement, but it is not designed to act as a complaints resolver for individual cases, as the ombudsman does.

Is the FCA an ombudsman?

There is formal coordination between the FCA and Financial Ombudsman but they are not the same thing, and they do not do the same job. The FCA and the Financial Ombudsman Service have separate roles where:

• The FCA is the conduct regulator (rules, supervision, enforcement). 
• The FOS is a dispute resolution body for individual complaints between customers and firms.

Is there an ombudsman for insurance companies?

The Financial Ombudsman Service (FOS) can deal with complaints about insurance, including complaints about insurers and insurance intermediaries, depending on eligibility and the type of complaint.

If you are not sure whether your complaint is something the FOS can look at, you can still start by making a formal complaint to the firm, because that is usually required first.